Question

SHOW WORK PLEASE!

Problem 5-16 Comprehensive Problem-Weighted-Average Method [LO5-2, LO5-3, LO5-4, LO5-5]

Builder Products, Inc., uses the weighted-average method in its process costing system. It manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:

Production data:
Pounds in process, May 1; materials 100% complete; conversion 90% complete		82,000
Pounds started into production during May		470,000
Pounds completed and transferred out		?
Pounds in process, May 31; materials 70% complete; conversion 30% complete		42,000
Cost data:
Work in process inventory, May 1:
Materials cost	$	152,300
Conversion cost	$	52,300
Cost added during May:
Materials cost	$	791,650
Conversion cost	$	287,390

Required:

1. Compute the equivalent units of production for materials and conversion for May.

2. Compute the cost per equivalent unit for materials and conversion for May.

3. Compute the cost of ending work in process inventory for materials, conversion, and in total for May.

4. Compute the cost of units transferred out to the next department for materials, conversion, and in total for May.

5. Prepare a cost reconciliation report for May.

Required 1

Equivalent units of production => Materials: Conversion:

Required 2

Cost per equivalent unit => Materials: Conversion:

Required 3

Cost of ending work in process inventory=> Materials: Conversion: Total:

Required 4

Cost of units completed and transferred out=> Materials: Conversion: Total:

Required 5

Cost of reconciliation

Costs to be accounted for
Total cost to be accounted for
Costs accounted for as follows:
Total cost accounted for

Answer 1

Equivalent unit of production

	EUP-Material	EUP-Conversion
Unit transferred out	510000	510000
Ending work in process	42000*70% = 29400	42000*30% = 12600
Equivalent unit of pro	539400	522600

Calculate cost per equivalent unit

	Material	Conversion
Beginning WIP	152300	52300
Cost added	791650	287390
Total Cost	943950	339690
Equivalent unit of production	539400	522600
Cost per equivalent unit	1.75	0.65

Cost of ending work in process

	Material	Conversion	Total
Cost of ending work in process	29400*1.75 = 51450	12600*.65 = 8190	59640

Cost of unit transferred out

	Material	Conversion	Total
Cost of unit transferred out	510000*1.75 = 892500	510000*.65 = 331500	1224000

Cost reconciliation

Cost to be accounted for
Beginning work in process	204600
Cost added	1079040
Total Cost to be accounted for	1283640
Cost accounted for as follows
Cost of unit transferred out	1224000
Cost of ending work in process	59640
Total Cost accounted for	1283640